Under what circumstances can Beef O Bradys terminate the Franchise Agreement with cause?
Beef_O_Bradys Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in Franchise Agreement ("FA") | Section in Area Development Agreement ("ADA") | Summary | |
|---|---|---|---|---|
| develop the Development Area, you sign a general release and pay us a Development Fee required by the successor development agreement. | ||||
| d. | Termination by you | Sections 16.1 and 16.3 | Not Applicable | FA: If we breach the agreement and do not cure the breach after 60-days notice from you, you may terminate 60 days after you provide us with written notice of termination (subject to state law). FA: Your failure to pay any Royalties, Marketing and Development Fund Contributions or other money after you receive notice of the default granting an opportunity to cure, will mean you are willfully and wrongful breaching the Franchise Agreement and you have decided to reject and terminate the FA and all Agreements between you and us (or our affiliates) related to the FA (subject to state law). |
| e. | Termination by us without cause | Not Applicable | Not Applicable | None |
| f. | Termination by us with cause | Section 16.2-16.4 | Section 9 | FA/ADA: We can terminate if you commit one of several violations (subject to state law, see Exhibit L). Under the "Cross-Default" provisions of the FA and ADA, any default or breach by you of your FA will also be deemed a default or breach of your ADA (and vice versa). If the nature of the default/breach under the FA would have permitted us to terminate the ADA if it happened under the ADA, then we may terminate the ADA (and vice versa). |
| g. | "Cause" defined – defaults | Sections 16.2 and 16.4 | Section 9 | FA: You have 5 days to cure health, safety or sanitation law violations, except we may require the immediate |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION. (FDD pages 46–54)
What This Means (2025 FDD)
According to Beef O Bradys's 2025 Franchise Disclosure Document, Beef O Bradys can terminate the Franchise Agreement with cause if the franchisee commits certain violations. These potential violations are subject to state law and are further detailed in Exhibit L of the FDD. The FDD also states that any default or breach of the Franchise Agreement by the franchisee will also be considered a default or breach of the Area Development Agreement, and vice versa, under the "Cross-Default" provisions. This means a breach in one agreement can trigger termination rights in the other.
Specifically, if a franchisee has health, safety, or sanitation law violations, Beef O Bradys requires the franchisee to cure the violation within 5 days. However, Beef O Bradys may require the immediate shutdown of the Family Sports Pub if they deem the violation a health threat. For monetary defaults to Beef O Bradys or approved suppliers, the franchisee has 10 days to cure the default. For noncompliance with any other provision, the franchisee also has 10 days to cure the issue, except for issues covered under Section 16.2 of the Franchise Agreement.
For a prospective Beef O Bradys franchisee, this means that maintaining strict compliance with all aspects of the Franchise Agreement and all applicable laws is crucial to avoid potential termination. The franchisee should pay close attention to health, safety, and sanitation standards, as violations in these areas can lead to immediate shutdown. Additionally, prompt payment to Beef O Bradys and approved suppliers is essential. Franchisees should also familiarize themselves with Section 16.2 of the Franchise Agreement to understand which noncompliance issues are not subject to the standard 10-day cure period.